Nifty Recap For The Day!!!

Like I had mentioned in my post yesterday that one can go long with a tight stop at 3050 for a target off 3225/50. Well with so much of volatility around we did manage a high of 3238 before giving up all the gains. Any up move is met with fresh selling and all excuses to squeeze whatever intra day gains are there to be had. Nobody wants to take chances of taking home some heavy line as the previous huge gap ups and downs are still playing games with traders’ minds.

Anyway a quick recap of today’s daily chart given below, we can see that Nifty found resistance at the channel line (lower) and quietly retreated back. We have an Inside Bar (IB), and the only way to play it is, as it ought to be played; that is go long or short on the breach of the high or the low of the IB!

The hourly chart below shows that the price is contracting within the channel lines (thick black lines) but also seem to be forming a falling wedge as marked in red dashed lines. As expected the price met with resistance at the falling 20 period MA and retreated. In this process we have made a lower high and a higher low for ourselves as of now. This means...yes a kind of contraction (if u remember your patterns you will agree with me that LL’s and HL’s are normally a prelude to triangles and wedges) and a breakout in any direction is imminent. Once again 3225/50 is of paramount importance before we even begin to think of anything big in terms of upside targets.

"If it is to be it is up to me."

Origin Unknown

Nifty Future..During the Day!!!

Is it my Illusion or Reality? Am I just being a victim of my Biases???

Weekend Views On Nifty!!!

I was getting to nervous with the markets and then a god sent opportunity came up … a weekend getaway to Goa with the kids! It was nice to soak in the sun and surf and tryin2keep my mind off the markets for a while. Now back refreshed albeit still confused about the whole issue regarding where’s the support? Normally these kinds of falls used to be termed as capitulation and were max for a day or two but this thing is turning into a slow and painful process. This reminds me of an example what Dr. Alexander Elder had mentioned in one of his books about how you can BOIL A FROG ALIVE!

Anyway moving on to the weekly chart below we can see Nifty has closed below the channel. The only support below is 2880 where as the first overhead resistance is at 3250. The MACD is still in triple bullish divergence and gets confirmed when Price closes above the previous week’s High (wishful thinking!)

The daily chart below is even more confusing with its Hammers and Tongs…. Tongs part is a bit of an exaggeration! And speaking of Hammers, the less said the better, off late they are providing false hope of reversal to the Bulls only to be hammered again by the Bears. The price is below the channel, we have two LL’s in place with a tennie weenie LH in between. Again I repeat we are trading too way down below the 20 period MA and a pullback to it so far has been very unsuccessful. Another LH will complete the pair for a new move down or if we close above the previous LH we can safely assume that trend for the short term has reversed ( I guess I am seeing mirages and illusions!) and I should be excused coz like I always say that Hope Lies Eternal In A Bulls Heart!

The intra day action summarized below in the hourly chart is a clearer picture of the LL’s and HL,s I have been talking about. This also shows how the price has been reacting to the falling 20 periods MA. We have a small divergence in MACD histogram, if we trade above 3100 for some time we can safely go long with a strict stop at 3050 to a target of 3225/3250 for starters.

"Action may not always bring happiness; but there is no happiness without action."

Benjamin Disraeli

Nifty Recap For The Day!

It ain’t over till it’s over, the bottom is not yet confirmed, and whatever quick pullbacks that are offered, be it the courtesy of the oversold indicators or overseas cues are promptly met with more short selling. Nothing seems to be working, the bailouts, the regulations, not even the PRAYING!

Like I had mentioned yesterday that it’s very difficult to find supports and only supports which I could see were in hourly charts at 3400 and 3325 and we just went there. Now all hopes are on 3250 (the channel support) and 3200 (protecting the earlier lows and trying to make a double bottom for now….wishful thinking! Any takers???). As for the upside we need to talk a resistance one at a time, how about 3450 and 3550 for starters!

"You may be disappointed if you fail, but you are doomed if you don't try."

Beverly Sills

Nifty Recap For the Day!!!

When the going gets good the smart book profits! Well this is what happened today. The rally yesterday gave impressive returns to the patient few who had used the earlier dip to buy into strong scrips and it warranted to take the money off the table at least a part of it (The Gambler by Kenny Rogers...gives one such advice..Enjoy!). Like I had mentioned on my post on Sunday that rally was in the making considering the oversold nature of the charts (of course the backdoor maneuvers of the various governments also helped), and voila we had ourselves a beautiful long green candle yesterday.

Speaking of today, the daily chart below shows a shooting star, signifying that many a trader wanted to book the instant profits that were a god sent opportunity in these troubled times, cant really blame them, for the way we have been gapping up and down crazily, its wiser to take in as much as you can. We are still way below the falling 20 period MA at 3880, a logical target for this up move to say the least. Talking of supports there is none other than protecting yesterday’s low, which also happens to be the channel support!

Moving on to the hourly chart, we can see that the price met with severe resistance at the falling 50 periods MA (the blue line) and has closed near the 20 periods (the green line). The support on the hourly charts is at 3400 and 3325, whereas any move up needs to surpass 3600 and 3650 to get the bulls back into any kind of reckoning!

"Nothing great was ever achieved without enthusiasm."

Ralph Waldo Emerson